Retail inflation: Retail inflation rate can increase to 3.8% – 4% in March. A month earlier, inflation reached the lowest level of 3.61% in February in February. Inflation was 4.31% in January 2025. The Ministry of Statistics will release inflation figures tomorrow, Tuesday, April 15.
While there is a mixed trend in the prices of vegetables, gold prices are increasing continuously. That is, food inflation is expected to remain stable, but the inflation of other items may increase slightly. Foods contribute about 50% to inflation rates.
Retail inflation in February
In February, the inflation rate came to a seven -month low to 3.61%.
Food inflation decreased from 5.97% to 3.75% on a month-by-month basis.
Rural inflation declined from 4.59% to 3.79% and urban inflation decreased from 3.87% to 3.32%.
How does inflation grow or decrease?
Increase and decline in inflation depends on the demand and supply of the product. If people have more money, they will buy more things. By purchasing more goods, the demand for goods will increase and if the supply is not in accordance with the demand, then the prices of these things will increase.
In this way the market becomes sensitive to inflation. In simple words, inflation increases due to excess flow of money in the market or lack of goods. On the other hand, if the demand is low and the supply is high, inflation will decrease.
Inflation is determined by CPI.
As a consumer you and I buy goods from the retail market. The Consumer Price Index (CPI) works to show changes in prices relatively. CPI measures the average price we paid for goods and services.
In addition to crude oil, goods prices and production costs, many other factors play an important role in determining retail inflation rate. The rate of retail inflation is determined based on the prices of about 300 items.
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